LeBron’s Big Payday

June 20, 2014By Rick Horrow and Karla Swatek

Miami Heat star LeBron James made a profit of more than $30 million in cash and stock as part of Apple’s recent $3 billion purchase of Beats Electronics. James received a small stake in the company at its inception in 2008 in exchange for promoting the high-end headphones. LeBron’s big payday from the Beats acquisition gives him a good reason to take less money should he opt for free agency. The deal is believed to be the biggest equity cash payout for a professional athlete in history, giving James $11 million more than his annual salary with the Heat.

Equity deals can be a wise investment for athletes, but they don’t always pay off. Look no further than Tiger Woods, who this past week replaced Fuse Science with MusclePharma on his golf bag. Woods had endorsed Fuse since 2011, but the equity-heavy deal flopped, as the stock is now trading around $0.01.